Credit Suisse Optimistic on Alder Biopharmaceuticals' "Derisked" Assets and "Potent" Candidates, Initiates Outperform Rating

In a report published Monday, Credit Suisse analyst Jason Kantor initiated coverage on

with an Outperform rating and $20.00 price target. Kantor is optimistic on an antibody platform with “highly potent” drug candidates and a couple derisked phase II assets. The analyst emphasized the benefits of the company's use of yeast to optimize antibody production. Credit Suisse wrote, “This technology overcomes many of the limitations of traditional antibody manufacturing: (1) low cost of production in yeast, (2) rapid scale up and high yields with the manufacturing process, (3) generation of a clinical candidate in a short period of time, and (4) ability to apply this technology to a wide range of therapeutic areas.” In addition to Alder Biopharmaceuticals work on antibody production, the company has made progress with the efficacy of ALD403 for migraines. With one treatment for a three-month period, 16 percent of those treated were migraine free for the period versus 0 percent for the placebo. 32 percent had a 75 percent reduction versus 9 percent for the placebo. The analyst expects “(1) clazakizumab Phase II data in psoriatic arthritis, (2) the initiation of Phase III testing for clazakizumab in RA, and (3) the initiation of additional Phase II trials for ALD403,” over the next 12 months. Credit Suisse assigns a 55 percent probability for success to ALD 403 and first sales in 2019. Shares of Alder Biopharmaceuticals closed at $10.74 on Friday.